Rockstar: 2011 Ended with a $1 Billion Bang

That recent list of billion-dollar brands isn’t complete without Rockstar, according to information supplied by the brand today.

Joey Cannata, the EVP of sales and distribution for the company, the third of the “big three” energy drink independents that also include Red Bull and Monster, told BevNET today that he believed the brand had likely passed the $1 billion retail number over a 12-month period trailing the middle of 2011, but offered numbers to back up his assertion that for the entire year.

Rockstar retail volume was at about $759 million for the full year of 2011, according to Symphony/IRI numbers offered by Cannata — which covers mass, drug, grocery and convenience chains excluding Wal-Mart and many independents.

Those accounts are more than enough to push Rockstar into ten figures, however, Cannata said. Last week, PepsiCo introduced three new $1 billion beverage brands as well.

“Wal-Mart is our number-one large format mass account,” he said. Without that giant account, as well as many small independent grocery and convenience stores, and the company’s military sales, among others, he said, the IRI numbers represent less than 70 percent of Rockstar’s overall retail sales volume.

Break out the dancing girls! We're at $1 billion!

“We’re a billion-dollar brand, no question,” Cannata said. “One could argue we passed it in the second half of 2010.”

The latest Nielsen Co. report, shared by Wells Fargo and Co. analyst Bonnie Herzog also showed that Rockstar ended the year burning brighter than the competition.

Rockstar saw solid huge dollar sales increase for the 52-week period ending on Jan. 21 — up nearly 18 percent over the previous year. The increase was second only to red-hot Monster Beverage Corp., which was up nearly 22 percent, but left Red Bull in the dust — the bull was up 14 percent year-over-year. It should be noted that all three major independent brands outpaced the energy category’s overall growth — which was still a very impressive 12.2 percent overall.

Rockstar’s fourth quarter was even more impressive, however, as it blew past its competition in the 12-week period ending Jan. 21 — up a whopping 25 percent over the same period from the previous year.

Much of that growth came from the addition of independent Pepsi distributors, Cannata said, particularly in the Southeast and South Atlantic states.

“They’re doing a great job of it,” he said. “They’re signing on and they’re really seeing Rockstar as the future of their energy portfolio.”

While there are still vestiges of its old DPSG and independent network in place, Rockstar is largely distributed by PepsiCo, Inc., while rival Monster goes mostly through the Coca-Cola Co. Inc. but also through a network of Anheuser-Busch/InBev distributors. Both companies saw gains that had to cheer their distribution partners, whose own energy portfolios remain in free-fall, both down about 14 percent.

So what drove the outstanding quarter — and year — for Rockstar? Certainly, in looking at the numbers, promotion played a big part, as the Nielsen report shows an aggressive promotional strategy throughout the year (11 percent vs. 5 percent for the category average ) but the volume boost for the company was significant.

Cannata downplayed the notion that the end-of-year promotion had been in place as an overly aggressive attempt to grab share, however, saying it was not a change from the company’s normally scheduled discounting program.

The idea of buying Rockstar at 2 for $3 as a price point may have simply been too appealing for some customers to turn down, he said.

“We have a robust calendar, but maybe our ‘take rate’ is just going up,” he said. “It gets pretty high when you run what was certainly an attractive price point.”